By Daniel Hunter
A new EU - US free trade agreement would deliver GDP growth equivalent to providing every worker in Ireland with an extra year's salary over the course of their career, according to the American Chamber of Commerce in Ireland.
The Chamber published a paper entitled The Transatlantic Opportunity: Why we need a Transatlantic Trade & Investment Partnership. The EU - US trade relationship is the biggest in the world with around €2 billion of goods and services traded every day between the European Union and the United States.
"A fully comprehensive deal has the potential to increase GDP in both economies by 3.5% and Ireland, as a leading economic player in the transatlantic economy will also see economic growth as a direct result of any new deal negotiated. This is a relationship that is vital to the strength of our economy, job creation and competitiveness", said Peter Keegan, President of the American Chamber of Commerce, Ireland.
The paper was launched at the start of a week that will see policy makers and industry leaders from both sides of the Atlantic gather in Dublin for a series of meetings in preparation for the formal negotiations which will commence in June.
Minister for Jobs Enterprise & Innovation, Richard Bruton TD said: "The EU-US trade relationship is a key driver of economic growth and job creation on both sides of the Atlantic. As Jobs, Stability and Growth are the key priorities of the Irish Presidency, we are prioritising work on an EU-US Transatlantic Trade Partnership. I'm happy to say that real progress has been made on the complex issues around creating an new trade agreement. This week's Informal meeting of EU Trade Ministers in Dublin will provide us with a valuable opportunity to move closer to an agreed position."
Mr. Keegan said "A Trade and Investment partnership between Europe and the United States would create a zone accounting for 40 per cent of world trade and could provide a lift to jobs and economic growth. The potential growth in EU exports to the US is expected to be 28% or €187 billion. Ireland's exporters could benefit significantly and conservative estimates put these benefits at over €100 million each year.
"Ireland is one of the top destinations in Europe for US FDI and benefits in the form of over 115,000 jobs, according to Mr. Keegan. "Almost a third of transatlantic trade is intra-firm trade, between different subsidiaries of the same company. Making this easier and more cost effective would make Ireland and Europe a more attractive investment prospect for US companies and make them more likely to consider investing directly in the EU to access its markets".
Mr. Keegan said that negotiations should focus on the elimination of all tariffs that exist between the two trading partners as well as on regulatory co-operation.
"Tariffs while not the primary barrier to transatlantic trade still exist albeit at a low level and the American Chamber believes it is now the appropriate time to eliminate all tariffs that exist between the EU and US", he said.
"However it is the removal of the many non-tariff barriers that exist that has the largest potential benefit to investors. This includes differences in regulatory procedures and high levels of resulting bureaucracy. The removal of non-tariff barriers is vital with as much as 80% of the total gains from this agreement stemming from cutting costs imposed by bureaucracy, regulation and liberalising trade in services and procurement", he said.
Mr. Keegan concluded saying that agreements reached on regulatory co-operation must be forward looking so that as new growth sectors emerge in the coming years and decades that they can thrive unhindered across the two trading blocs.
"In this regard the negotiations offer the trading partners an opportunity to inaugurate a leadership position in the management of intellectual property rights. White both parties agree on the importance of protecting these rights, threats lie in other regions where these values are not shared. A harmonised approach to intellectual property protection would create an international best practice standard for other regions to aspire to."
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